CIPP Response to the HMRC consultation on voluntary payrolling

05 September 2014

The CIPP has now submitted its response to the HMRC consultation on voluntary payrolling.

This proposal would allow employers to report some or all of their Benefits in Kind through the payroll. The research was conducted through an electronic online survey circulated to CIPP and AAT members to which there were 79 responses. The Policy team would like to thank all those members of both the CIPP and the AAT who responded to this survey.

The key findings of the response are:

Although 69% of all respondents agree that voluntary payrolling provides the best framework for simplicity, opinion is more divided between agent respondents and employers, with only 42% of AAT members agreeing that this is the best route, compared with 78% of CIPP members.

Those who disagree provide valid arguments that the opportunity to payroll should either be compulsory for everyone or should not be available to anyone.

Businesses with between 5,001 and 10,000 employees were the least likely to agree with voluntary payrolling.

Almost 76% of respondents agreed that they would seek to payroll some or all benefits, with 68% of AAT members and 81% of CIPP members agreeing that they would introduce this for some or all of their benefits.

There was common agreement that payrolling would not be suitable for all benefits.

The number agreeing that they are likely to implement payrolling for some or all of their benefits increases in direct correlation with the number of employees.

Almost 57% of all respondents felt that employers should be free to choose, from an approved list, which benefits to payroll.

Three quarters of all respondents agreed that payroll should be compulsory for all employees receiving that benefit with no exceptions.

There was strong disagreement that payrolling should be irrevocable with only 23% agreeing with this suggestion.

Almost 85% of all respondents preferred to account for Class 1A NICs in real time.

More than 55% of businesses with more than 10,000 employees are currently payrolling at least one benefit.

Click here to view the full response